Correlation Between Guangdong Xiongsu and Ningxia Younglight
Specify exactly 2 symbols:
By analyzing existing cross correlation between Guangdong Xiongsu Technology and Ningxia Younglight Chemicals, you can compare the effects of market volatilities on Guangdong Xiongsu and Ningxia Younglight and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Guangdong Xiongsu with a short position of Ningxia Younglight. Check out your portfolio center. Please also check ongoing floating volatility patterns of Guangdong Xiongsu and Ningxia Younglight.
Diversification Opportunities for Guangdong Xiongsu and Ningxia Younglight
0.64 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Guangdong and Ningxia is 0.64. Overlapping area represents the amount of risk that can be diversified away by holding Guangdong Xiongsu Technology and Ningxia Younglight Chemicals in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Ningxia Younglight and Guangdong Xiongsu is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Guangdong Xiongsu Technology are associated (or correlated) with Ningxia Younglight. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Ningxia Younglight has no effect on the direction of Guangdong Xiongsu i.e., Guangdong Xiongsu and Ningxia Younglight go up and down completely randomly.
Pair Corralation between Guangdong Xiongsu and Ningxia Younglight
Assuming the 90 days trading horizon Guangdong Xiongsu Technology is expected to generate 1.08 times more return on investment than Ningxia Younglight. However, Guangdong Xiongsu is 1.08 times more volatile than Ningxia Younglight Chemicals. It trades about 0.01 of its potential returns per unit of risk. Ningxia Younglight Chemicals is currently generating about 0.0 per unit of risk. If you would invest 730.00 in Guangdong Xiongsu Technology on October 11, 2024 and sell it today you would lose (45.00) from holding Guangdong Xiongsu Technology or give up 6.16% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Guangdong Xiongsu Technology vs. Ningxia Younglight Chemicals
Performance |
| Timeline |
| Guangdong Xiongsu |
| Ningxia Younglight |
Guangdong Xiongsu and Ningxia Younglight Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Guangdong Xiongsu and Ningxia Younglight
The main advantage of trading using opposite Guangdong Xiongsu and Ningxia Younglight positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Guangdong Xiongsu position performs unexpectedly, Ningxia Younglight can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Ningxia Younglight will offset losses from the drop in Ningxia Younglight's long position.The idea behind Guangdong Xiongsu Technology and Ningxia Younglight Chemicals pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.
| Ningxia Younglight vs. Panda Dairy Corp | Ningxia Younglight vs. Shanghai CEO Environmental | Ningxia Younglight vs. Innovative Medical Management | Ningxia Younglight vs. Sanbo Hospital Management |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Other Complementary Tools
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Portfolio Center All portfolio management and optimization tools to improve performance of your portfolios | |
| Alpha Finder Use alpha and beta coefficients to find investment opportunities after accounting for the risk | |
| Aroon Oscillator Analyze current equity momentum using Aroon Oscillator and other momentum ratios | |
| Portfolio Volatility Check portfolio volatility and analyze historical return density to properly model market risk |